The Devil’s Down in Georgia

I just arrived yesterday evening, and the place is stunning. [The Rude Awakening] May 15, 2023 [WEBSITE]( | [UNSUBSCRIBE]( The Devil’s Down in Georgia - It’s 05:13 Monday morning as I frantically type! - What a crazy trip yesterday was. - This little southeastern bit of Georgia is out of this world. [Do you live in one of the states listed?]( If you live in one of these 43 states… You must [watch this urgent warning]( immediately. (You Need To Learn About AOC’s “Green New Scam” In Order To Opt-Out) To learn the single most important move you need to make to protect you and your family this summer... [Click here now]( or the play button above. [Click Here To Learn More]( [Sean Ring] SEAN RING Dear Reader, Happy Monday from a still-dark Jekyll Island! I tried to pump out something before I crashed last night. But Mr. Sandman demanded I sleep, as I had traveled from Milan to New York to Jacksonville to Jekyll Island in one crazy day. So nuts was my day, I’ll tell you all about it. Then, when the rest of my friends and colleagues get here, I’ll get back to business. Warning: the Rude may smell of single-malt Scotch this week. Before I start: some of this Rude may sound like a moan. I assure you I’m thrilled to be here at Jekyll Island, in all its ethereal beauty. Wake Up Call “Does my phone really read 06:37?” I asked myself yesterday morning. It was rather inconvenient, as check-in time was 07:00. Thus started what would become the pattern of the day. Fits and starts and rushes around, trying not to miss flights. I took a three-minute shower, brushed my teeth, packed what I needed, and ran out of the hotel. Luckily, Matt Insley put me up in a hotel adjacent to the airport terminal. Even at my advanced weight, I made it to the check-in desk at 07:05. I was pretty impressed with myself. As I’m a conscientious traveler, my documents are always in order. Before boarding, I only needed to pick up the single malt I had been ribbing the team about. Nothing raise my hackles more than… seeing whisky spelled with an “e.” When whiskey is spelled like this, it means the Irish or, heaven forbid, the American stuff. I prefer “whisky,” which means Scottish stuff, or just plain Scotch. So when we were talking about the trip and the team mentioned a Whiskey Bar, I knew I had to do something! So I picked up a bottle of Laphroaig Four Oak to start. Known to its friends as “Froggie,” Laphroaig packs a peaty punch. And no, Lagavulin was not available in the duty-free shop, if you were wondering. Then, a bottle of The Balvenie stared at me from the top shelf. I first drank The Balvenie at Mehrangarh Fort in Jodhpur, Rajasthan, India. Rudyard Kipling called the fort “the work of giants,” and the Indians call it “The Citadel of the Sun.” It’s an incredible wonder of architecture. My boss Alex asked me to teach a seminar there back in 2018. He brought that bottle. I fell in love immediately. With the whisky, not Alex. I try never to be snobby about booze. But if you’re going to be, getting snobby about whisky is worth it. That part of the mission was accomplished—time to get on the plane. The Flight to NYC For some reason, I love dystopian Japanese-themed films and movies. Perhaps it’s because they have an exactness of design, a melancholy, and a fatalism about them I simply don’t possess. Whether it’s The Wolverine, Altered Carbon, or The Ghost in the Shell, I eat it up. It’s also the reason I love the John Wick franchise so much. Weird, but true. So I had to watch Bullet Train with Brad Pitt and Aaron Taylor-Johnson. It was a hoot, though I don’t think it’s for everyone. Then I passed out for about 5 hours, thank heavens. I had had a terrible three hours of sleep in the hotel, so I was thrilled when I woke up and saw that we were only 90 minutes away from JFK. So I ate my breakfast, and we descended into the world’s dumbest airport. [Urgent Notice From Paradigm CIO Zach Scheidt!]( Hi, Zach Scheidt here… I’m the Chief Income Officer at Paradigm Press. With inflation raging (and showing no signs of coming to an end any time soon), almost everyone in America is feeling the pain in a big way. Which is why, several months ago, I set out on a big mission… my goal was to create a [complete, step-by-step plan to surviving and beating inflation]( one that anyone could take advantage of. Today, after hundreds of hours of research, I’m revealing all of my findings. [Simply click here now to see how to survive America’s deadly inflation crisis](. [Click Here To Learn More]( What Are They Thinking in JFK? As I arrived at the Immigration Hall, I thought, “This can’t be real.” No kidding: at least 1,200 people, by my conservative count, were waiting to be processed. And they were just standing there! It seems “da union” doesn’t get its people in until the entire hall is clogged. But for the first fifteen minutes, I might have moved ten feet. My flight to Jacksonville was still two-and-a-half hours away, so I wasn’t worried. But after an hour, I asked to get moved up front, so I wouldn’t miss my flight. Much to my relief, they obliged. I passed the Immigration officer’s test with flying colors, and he let me in. I don’t know if you know this, but the USG has this stupid rule. If you’re flying into America from abroad and have a connecting domestic flight, you must pick up your luggage and check it in again. It’s the dumbest thing ever. So I did that, and the guy barely looked at my tag before dumping my bag on the luggage belt. I thought, “What’s the point of this exercise?” Then I realized I was outside the airport - where they put this conveyor belt - and I had to go back through security. Of course, that took another hour. Once I got through security, who meticulously checked whether my Scotch was plutonium, I checked my gate. B55. And how many gates are in T4 at JFK? 55. So it was time to revisit my track days to ensure I made the gate. I did, with 15 minutes left until takeoff. Luckily, they let me on the plane. The flight was smooth but cramped. JAX Is Almost a Perfect Airport Did you ever land at an airport and remember that you’d forgotten something essential? As I stepped off the plane in Jacksonville, I remembered that I had to pee since I landed at JFK. Luckily, I hadn’t exploded like Monty Python’s Mr. Creosote and quickly found the men’s room. JAX is a lovely airport but has no restaurants after the baggage claim. Ugh. I was hungry at this point. Fortunately for me, Paradigm’s very own Miss Moneypenny, the perfectly named Lydia England, was landing right within the half-hour. The Ride North With Moneypenny Lydia organized this week for us, so I knew I was in good hands. She flew down from Baltimore early to get a headstart, ensuring everything was just so. Blonde-haired, cheery, and ready to rock, Lydia had rented a car for us to drive the hour north from JAX to Jekyll. What a pleasant ride - and a pitstop at McDonald’s to boot! (See, I’m not a snob about everything.) The sky was clear, the temperature was perfect, and the road was wide open for us. Arriving on Jekyll Island In no time at all, we arrived here at Jekyll. Lydia noticed the Spanish Moss dangling in the wind from the larger trees. It’s every bit as exotic to me as the trees growing at Ta Prohm temple at Angkor Wat. (Think Tomb Raider.) The Jekyll Island Club and Resort hotel is as Old South as this Joisey boy can imagine. I checked in and was quickly off to bed. Wrap Up Of course, the reason I’m here is our livestream. If you haven’t signed up already, I’ve made a trip for nothing! Just kidding. I want you to join us because, well, where else will you get [Jim Rickards and Danielle DiMartino Booth chinwagging]( about the state of the world? It’s all for you. Free. Gratis. Gratuito. And no hard sell at the end. Like Rickards Uncensored on steroids. [Sign up here]( if you haven’t already. Last time I checked, over 11,000 people are taking a [two-hour lunch]( this Wednesday at 1 pm to hear what Jim and Danielle have to say. I can’t wait, myself. See you there! All the best, [Sean Ring] Sean Ring Editor, Rude Awakening In Case You Missed It… America and the World’s Dilemma [Sean Ring] SEAN RING Dear Reader, Happy Friday was a gloomy, cloudy Asti. I don’t mind the cloud cover, as we can use the rain to refill the entire Po Valley. And it reminds me of London anyway. Before I get to the rest, I just want to remind you to sign up for the Jekyll Island livestream if you haven’t. I don’t mean to be a pest, but Jim Rickards and Danielle DiMartino Booth are giving us two full hours of coverage, totally free of charge, for you and all your friends. [Click here to join.]( Like most Friday pieces, today’s is supposed to be light. This, I hope, eases you into the weekend. But the Triffin Dilemma is also essential to the current economics puzzle. And it’ll make you sound super bright at dinner parties. So there’s no need to memorize any of this. In fact, I’d just bookmark it so you can come back to it whenever you want. In this edition of the Rude, we will cover the Triffin Dilemma, what it is, how it affects us today, and its possible solutions. Who was Robert Triffin? Robert Triffin was a Belgian-American economist known for analyzing the problems with using national currencies (like the U.S. dollar) as international reserve currencies. He was born in Belgium on October 5, 1911, and died on February 26, 1993. Triffin earned his Ph.D. in Economics from Harvard in 1938. He worked for the Federal Reserve System and the International Monetary Fund before becoming a professor of economics at Yale, where he taught from 1951 to 1977. Triffin is best known for his “Dilemma” or “Paradox.” It describes the conflict between short-term domestic and long-term international economic objectives for countries with global reserve currencies. He presented this idea to the U.S. Congress in 1960. Triffin was also instrumental in creating the European Monetary System and proposed the creation of what is now the European Currency Unit (ECU), a precursor to the euro. What was the Triffin Dilemma? The Triffin Dilemma is an economic concept describing the problems that arise when a national currency also serves as an international reserve currency. The "dilemma" or conflict comes from the different economic objectives a country must try to balance when its currency is used as a global reserve currency. On the one hand, the global economic community demands an ample supply of reserve currency for international trade and financial transactions. This means the country issuing the reserve currency (the US, in today’s case) would need to run large trade deficits, essentially supplying the world with its money. Sound familiar so far? On the other hand, maintaining the value and stability of the currency is also important. If the country runs large and consistent trade deficits, it may lead to a lack of confidence in the currency's value. In the long run, this could lead to a currency crisis. Again, this is all too familiar. And it also runs right up against the debt ceiling crisis in the news today. The U.S. must balance the global demand for dollars (which necessitates running trade deficits) with the need to maintain the value and stability of the dollar. This is the essence of the Triffin Dilemma. It’s worth noting China doesn’t suffer from this as the yuan isn’t a reserve currency yet. What’s the “Impossible Trinity?” The Triffin Dilemma indeed involves a kind of "impossible trinity," but it's not the same as the one commonly referred to in macroeconomics. In the context of the Triffin Dilemma, the "impossible trinity" can be thought of as: - Maintaining a fixed exchange rate: A country with a global reserve currency might want to keep a fixed exchange rate to provide stability and certainty for international trade and finance. (Note: in regular macroeconomics, this point is a stable exchange rate rather than a fixed one.) - Free capital movement: In a globalized world, capital is often desired to move freely across borders. This can facilitate investment and economic growth. - An independent monetary policy: A country may use monetary policy to manage its domestic economy by setting interest rates to control inflation or stimulate growth. However, according to the Triffin Dilemma, a country whose currency is the global reserve currency can't achieve all three of these goals simultaneously. If it wants to maintain a fixed exchange rate and free capital movement, it can't also have an independent monetary policy. The need to provide liquidity to the rest of the world (by running a current account deficit) would conflict with its domestic monetary policy goals. If it wants free capital movement and an independent monetary policy, it can't maintain a fixed exchange rate. Changes in interest rates would lead to capital flows that affect the exchange rate. And if it wants a fixed exchange rate and an independent monetary policy, it can't have free capital movement. Capital controls would be needed to maintain the fixed exchange rate in the face of changes in interest rates. This is the essence of the Triffin Dilemma, highlighting the challenges countries face when their currency is used as the global reserve currency. Again, the Chinese are in no rush to get into this mess. [Biden’s Plan to Confiscate Your Cash?]( On March 9, President Biden quietly signed Executive Order 14067. This Order could pave the way for Democrats holding onto power in 2024. In fact, they could control America indefinitely. A former advisor to the CIA and Pentagon believes this order could allow for legal government surveillance of all US citizens; total control over your bank accounts and purchases; and the ability to silence all dissenting voices for good. To protect your freedom and your wealth, [see his dark warning now](. [Click Here To Learn More]( What are the Possible Solutions? There are several potential solutions that economists and policymakers have proposed over the years: - Multiple Reserve Currencies: The burden currently falls solely on the U.S. dollar would be distributed. For instance, the euro, yen, and yuan could play more prominent roles. This is the likeliest scenario. - Supranational Currency: As a regional currency, the euro is a mess. Just imagine a global one! - Central Bank Digital Currencies (CBDCs): Biden Bucks? Heaven forfend! - Gold Standard: I would love it, but the Fed and other mainstream economists would never allow it. - Policy Coordination: Sooner or later, this would break down, as it always does. - Managed Floating Exchange Rates: It’ll break one day like it always does. Each of these potential solutions comes with its challenges and trade-offs. Speaking of the euro, Triffin’s ideas greatly impacted the project. The Formation of the Euro While he wasn't directly involved in forming the euro (which happened several years after his death), Triffin’s ideas and proposals greatly influenced the process. Triffin was a strong advocate for European integration, and he believed that a common European currency would be a crucial step toward this goal. In the 1960s and 1970s, he proposed the creation of a European reserve currency, which he called the "Europa," and a European Central Bank. His idea was for European countries to pool their gold and dollar reserves to back this new currency. This new currency would then serve as a common reserve currency for the European Economic Community, reducing Europe's dependence on the U.S. dollar and helping to stabilize the global financial system. Although Triffin’s specific proposal wasn't adopted, his ideas significantly influenced the discussions around monetary integration in Europe. The European Currency Unit (ECU), a basket of the currencies of the European Community member states, was introduced in 1979, and it served as a precursor to the euro. The euro was eventually launched in 1999, and the European Central Bank, which Triffin had proposed, was established to manage it. Of course, whether the euro sees out the decade is anyone’s guess. Wrap Up Robert Triffin was an influential and insightful economist whose “dilemma” vexes world economic policy to this day… and daily! Now you know more about it and why U.S. debt keeps piling up. Our current monetary system makes it almost impossible for U.S. debts to shrink. Do our young congressmen and women know anything about Robert Triffin? I wouldn’t bet a dollar on it. Have a wonderful and restful weekend! All the best, [Sean Ring] Sean Ring Editor, Rude Awakening ‘Secrets of Jekyll Island’ A LIVESTREAM Broadcast with Jim Rickards & Danielle DiMartino Booth [Jekyll Island] On Wednesday May 17th at 1pm EDT you can watch live, exclusively through your access link from the comfort of your own home, as two of the world’s foremost thought leaders deliver world class economic insight. [Click Here Now to Reserve Your Seat]( Clicking the button above automatically registers you for ‘Secrets of Jekyll Island’ but does not obligate you in any way to attend the event. 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